Hurry now while stocks last

Hurry now while stocks last: apparently, Clifford Chance is paying some of its newly qualified solicitors, presumably aged c. 25, £85,000 p.a. At a guess that is 1,000 hours p.a. charged out at £400 per hour. You lucky customers. Incidentally, the other 1,000 hours p.a. or so in the office are spent filling in the time sheets and attending staff courses majoring on gender diversity.

*****

As I understand matters it is okay to raise money for a limited liability company from a maximum of twenty potential investors. This limit voids deploying a prospectus. Thereafter the prospectus rules kick in. These are horrendously expensive to observe and cause those raising money to waste a lot of time on top. Such that in practice money that could be raised for a worthwhile end is not raised.


It is of course claimed that conditions relating to the management of the venture are set in stone in a prospectus and therefore to hand should investors feel the need. However, the trouble is that in practice small investors in small companies receive little or no protection. What really matters is whether the managers will behave reasonably; that is an act of faith on the part of the investors. It was always thus.

Crowdfunding is just an advertisement of a cause. But it is certainly gaining traction as small investors partake in the game of investment even though their experience is not good and frequently as encountered in the following clip:

http://fantasyequitycrowdfunding.blogspot.co.uk

Last night Swen Lorenz published on Master Investor an article on the outlook at The Syndicate Room highlighting the considerable appeal of crowdfunding where small investors can invest alongside professionals. This is a sensible start.


But I have my reservations as to what is generally offered. For instance, about nine months ago a racehorse trainer contacted me to ask what I thought about crowdfunding. I told him not to touch it since I assumed that I was being asked about his personal investment programme. A few months later I learnt that he was in fact raising money from those who had been persuaded by him to invest in a racehorse. This of course is nothing to do with investor protection or my looking after his money. It’s all about his looking after the money of others.

*****

Finally, I bought a further 350,000 Six Hundred Group (LON:SIXH) yesterday at 13p. I can’t think who’s selling given that, seemingly, the shares are on any construction cheap. Are there any more to sell? I only ask since, at this rate, I am going to end up with a discloseable stake where I am far from sure that I seek that result.